House of Representatives

Supplementary Explanatory Memorandum & Correction to the Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon Peter Costello, MP)

General outline and financial impact

Technical amendments

The amendments to this Bill will clarify particular aspects of the:

•

provision of tax services by registered tax agents and lawyers;

•

delivery of BAS services by members of a recognised professional association from 1 July 2000; and

•

administrative penalty regime and approved form provisions so that those areas of the law operate as intended.

The amendments will also modify previously enacted areas of the law to support the new tax system from 1 July 2000. These amendments include:

•

an extension to the provisions in the ITAA 1997 which provide an immediate write-off of GST-related expenditure;

•

an exclusion for wholly input taxed supplies from the no ABN withholding event in the PAYG withholding provisions in Schedule 1 to the TAA 1953; and

•

a modification to the application provisions of the standardised collection and recovery rules in Schedule 1 to the TAA 1953.

Date of effect: The amendments will generally apply from 1 July 2000.

Proposal announced: The modifications to the GST- related expenditure were announced in Treasurer's Press Release No. 40 of 23 May 2000. The other amendments have not been previously announced.

Financial impact: The amendments are not expected to have a financial impact.

Compliance cost impact: The amendments are not expected to have an impact on compliance costs.

Summary of regulation impact statement

A regulation impact statement was provided in the explanatory memorandum to this Bill. A further statement is not required.

Amendments to Customs Act 1901 and Excise Act 1901 for the Diesel and Like Fuels Rebate Scheme

The amendments will enable a rebate of duty to be paid for the off-road business use of 'like fuels' for eligible purposes, by amending the provisions of the Customs Act and the Excise Act relating to the DFRS.

Date of effect: The amendments will commence from 1 July 2000 so that the extended rebate will be available for fuel purchased for use on or after 1 July 2000. The rebate will not be available for fuel purchased for use after 30 June 2002, when it is intended that it will be replaced by a new Energy Grants (Credits) Scheme. The amendments are technical amendments enabling rebate rates to be declared. As such, the amendments have no financial impact or compliance cost in themselves. The financial impact and compliance cost information below relate to the expansion of the DFRS as a whole.

Proposal announced: The significant reduction in the cost of fuel to business, particularly in the categories of heavy transport, marine transport and rail was announced by the Government on 28 May 1999 as part of the agreement between the Government and the Australian Democrats.

Financial impact: The expansion of the DFRS will cost an additional $420 million in the 2000-2001 financial year and $480 million in the 2001-2002 financial year.

Compliance cost impact: Medium. The amendments to the DFRS will have little effect on those currently entitled to a rebate under the scheme. Those categories of users presently entitled to claim a rebate are already required to keep records to substantiate their claim. The substantiation requirements for those entitled to claim the rebate as a consequence of these amendments will be the same as for those previously entitled.

Application: The rebate for like fuels will be available for fuel purchased for use between 1 July 2000 and 30 June 2002. It is intended that from 1 July 2002 the DFRS will be replaced by an Energy Grants (Credits) Scheme.

Access to ABN information

Amendment 31 inserts a new Schedule 4C into the Bill. New Schedule 4C amends the ABN Act to limit public access to details contained in the ABR.

Under existing law, state, territory and local government bodies are able to obtain, through public access to the ABR, sufficient ABN information to carry out their functions. However, the amendments to limit public access would severely restrict the information that state, territory and local government bodies could obtain. Therefore, the amendments also enable state, territory and local government bodies to access ABN information in the same way as the Commonwealth accesses ABN information.

Date of effect: From 1 July 2000.

Proposal announced: Not previously announced.

Financial impact: The amendment will not alter the financial impact of the ABN Act.

Compliance cost impact: The amendment will not alter the compliance cost impact of the ABN Act.